Yahoo Open Strategy could also help make the company a viable competitor to Google, and could help save Yahoo. "Essentially, Yahoo OS could turn Yahoo into one giant social networking service, but one, as opposed to services such as MySpace and Facebook, that actually delivers on what a social network service is supposed to do: facilitate social relations, automatically keep track of connections, allow for any sort of communication, allow collaboration," Weide said in a research brief.
Weide said Yahoo's Open Strategy would attract more users and would be more likely to retain them. The users themselves would spend more time on the service and would also generate more page views. It could also leverage data on users' social relations and their online behavior to better target ads, promising a better return on investment for advertisers' marketing dollars, he said.
Dana Gardner, an analyst at Gilford, N.H.-based Interarbor Solutions, said Yahoo needs to improve the depths of its relationships with its end users. And that means getting more metadata about who they are, what they do and what they like, he said.
"The way they're going to do that is, they're going to embrace the social networking functions much more deeply and in a sense try to take what MySpace and Facebook and LinkedIn and those types of organizations do and make that part of the whole Yahoo experience," he said. "So instead of going to a separate site to do networking, you can do your social networking while you're doing whatever else you're doing on Yahoo."
He said Yahoo has to become a life-style site where users spend a lot of time and create lots of page views so the company can take that information back and sell it to the advertising community in a way that Microsoft cannot. And that's something the Open Strategy initiative could accomplish.
However, Allen Weiner, an analyst at Gartner, said that although Yahoo's Open Strategy is more definitive than other plans, he's not sure it will resonate beyond analysts and other close watchers of the market.
Charlene Li, an analyst at Forrester Research Inc. in Cambridge, Mass., in a blog post, also said that Yahoo's new Open Strategy could position the company to bring users back into the fold.
Information from the IDG News Service was included in this report.